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January 20, 2009

How is Adlabs faring under ADAG?

Businessworld has an article on how the leading film processing firm is doing post its acquisition by Reliance ADAG.
But Anil Ambani’s Adlabs made Shetty’s Adlabs look puny with leapfrogging growth and a steady flow of funds. In 2005, Ambani infused Rs 227 crore by way of equity and $100 million (Rs 450 crore) through a foreign currency convertible bond (FCCB) issue, thereafter.

Three years after the takeover, Adlabs owns close to 450 screens, most of them overseas. The lion’s share — 200 — was acquired in the US, another 51 in Malaysia and six in Mauritius. In India, the company has 186 screens spread over 83 cinema properties providing 71,000 seats.

...However, the spanking expansion has dented the company’s once healthy bottom line. For the first quarter of the current financial year, net profit is just Rs 2.3 crore compared to Rs 22.4 crore (yoy). For the quarter ended September 30, this financial year, the company has actually suffered a net loss of Rs 20.8 crore.

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the private equity and venture capital ecosystem in India. View free samples of Venture Intelligence newsletters and reports. Email the author at